Nice to see someone gets it. When the Fed goes out and buys bonds guess who they are buying them from -- right, GS. What does GS do when the Fed gives them a wink and a nod. They buy lower (a lot lower) than where they sell them. It's like reaching into the taxpayers pocket and taking money. Blankfein refers to this as "God's work."
why Wall Street traders win and you don't
- Thread starter garfangle
- Start date
cgarcia and his friends was saying same thing. i did post my statements while ago..not 99% of days,but close. on couple DAYTRADING accounts there is no losing week for at least a year. have to add that those are small,not really scalable semi automated systems.but capable to produce stable 100-150% a year on 30-50K investment.
so...based on my own experience i would say-it's maybe hard,but not impossible.
Alex Gerchick from âWall Street Warriorsâ comes to mind..
http://www.elitetrader.com/vb/showthread.php?threadid=176263
wall street firms like goldman sachs or some wellf funded hedge funds have access to unlimited fed funds at 0% interest AND naked shorting can short any stock in any market,,,and have enough capital to move any stock and even move markets or manipulate markets oen trader has like what 20% of the silver market that is moving the market or manipulating the market..
the average joe trader has limited captial and limited information
the average joe trader has limited captial and limited information
Day-trading is one of the dumbest jobs there is: According to one academic study, 4 out of 5 people who do it lose money and only 1 in 100 do it well enough to be described as "predictably profitable." Most of the folks who do it, in other words, would be far better off working at Burger King.
As is often the case when we bring up these facts, some readers screamed. One said that our brain-damage was made patently obvious by the fact that Wall Street professionals day-trade all day. If day-trading were so dumb, then why would professionals do it?
Here's what that particular reader is missing: Most Wall Street traders get paid to day-trade other people's money.*
That's a huge difference compared to what most stay-at-home day-traders do.
The average professional trader gets paid somewhere between 1% and 3% of assets per year just to trade those assets all day. The average hedge-fund trader gets paid another 20% on top of that for any "gains" he or she makes (regardless of whether the gains are the result of the trader's trading or the bull market).
The average stay-at-home day-trader, meanwhile, trades his or her own money. And while many of these traders do fine on a gross basis (before costs), once the costs of this trading are deducted (commissions, taxes, research and information, time), their performance is usually downright awful.
The reason so many professionals day-trade, in other words, is that getting paid to day-trade other people's money is one of the best businesses in the world.
Day-trading your OWN money, meanwhile, is one of the worst.
* There's another difference, too, of course: Most Wall Street traders have skills, information, and tools that day-traders can only dream of. Trading is a zero-sum game: Market moves aside, every dollar won by one trader comes out of the pocket of another trader. Day traders competing against Wall Streeters is the equivalent of a college football team (or Pee Wee team, depending on the day-trader's skill) competing against a pro team. Is it possible to win? Yes. But it's highly unlikely (1 in 100). Wall Street's winnings do have to come from somewhere, though, so Wall Street thanks the day traders for playing.
There are two new huge challenges for today's daytrader.
HFT with their faster computers and SEC vs. Tuco where Prop firms are going out of business fast.
As is often the case when we bring up these facts, some readers screamed. One said that our brain-damage was made patently obvious by the fact that Wall Street professionals day-trade all day. If day-trading were so dumb, then why would professionals do it?
Here's what that particular reader is missing: Most Wall Street traders get paid to day-trade other people's money.*
That's a huge difference compared to what most stay-at-home day-traders do.
The average professional trader gets paid somewhere between 1% and 3% of assets per year just to trade those assets all day. The average hedge-fund trader gets paid another 20% on top of that for any "gains" he or she makes (regardless of whether the gains are the result of the trader's trading or the bull market).
The average stay-at-home day-trader, meanwhile, trades his or her own money. And while many of these traders do fine on a gross basis (before costs), once the costs of this trading are deducted (commissions, taxes, research and information, time), their performance is usually downright awful.
The reason so many professionals day-trade, in other words, is that getting paid to day-trade other people's money is one of the best businesses in the world.
Day-trading your OWN money, meanwhile, is one of the worst.
* There's another difference, too, of course: Most Wall Street traders have skills, information, and tools that day-traders can only dream of. Trading is a zero-sum game: Market moves aside, every dollar won by one trader comes out of the pocket of another trader. Day traders competing against Wall Streeters is the equivalent of a college football team (or Pee Wee team, depending on the day-trader's skill) competing against a pro team. Is it possible to win? Yes. But it's highly unlikely (1 in 100). Wall Street's winnings do have to come from somewhere, though, so Wall Street thanks the day traders for playing.
There are two new huge challenges for today's daytrader.
HFT with their faster computers and SEC vs. Tuco where Prop firms are going out of business fast.
The truth is simple: the money is made from the comissions and not from taking outright risk.
If I make 1 basis point from $1,000,000,000 of client flow each day and there are 260 trading days a year, I will make $26m.
Given that I have a profit cushion, I am able to take a bet and risk $1m, knowing net that if I'm wrong, I've still made $25m.
The advantage I have is large 2-way order flow. It also helps that if I know some clients are good with the direction of their bets, I can join them in the same direction.
If I make 1 basis point from $1,000,000,000 of client flow each day and there are 260 trading days a year, I will make $26m.
Given that I have a profit cushion, I am able to take a bet and risk $1m, knowing net that if I'm wrong, I've still made $25m.
The advantage I have is large 2-way order flow. It also helps that if I know some clients are good with the direction of their bets, I can join them in the same direction.
The folks at Financial Institutions like Goldman or any other financial firm pick any have access to information you do not have and never will have. They have hundreds/thousands of eyes watching everything. This alone has you outmatched. They have teams of economists following every little gyration in the economy and teams of financial analysts that are 10 times financially smarter and more financially astute and savvy and better educated that AJT. Every move of every market is seen. They have access to CEO's of every company, politicians around the world. They have teams of folks following events around the world. When information whether economic or political breaks they are way ahead of you. They know market moves ten moves before you do. Whether it is the direction of the price of a stock or corn, wheat or oil or platinum or gold or currencies or what have you. They are smarter than you, they are bigger than you, faster than you, stronger than you and in this reality david gets crushed 99.99% of the time.
It is like some amateur chess player going against a chess master. The chess master can see everything unfold a dozen moves ahead of the amateur. He sees the entire board. The amateur at best can only hope to move his piece correctly with his current move. The amateur is just guessing. The professional isn't guessing he knows the move to make and the direction to go. The AJT only hopes and guesses he is making the right move guessing the right direction of a security. The chess master takes his pieces away at will. This is wallstreet slowly taking away your pieces little by little one piece at a time. This is the AJT vs Wallstreet.
You are bringing a knife to a gun fight. And the guns they have are howitzers and m1 tanks, fleets of jet air craft, nukes/
You little peons just don't get it all? Do you? How badly out matched you really are?
All you can hope to do is scratch and claw by guessing and gambling.
It is like some amateur chess player going against a chess master. The chess master can see everything unfold a dozen moves ahead of the amateur. He sees the entire board. The amateur at best can only hope to move his piece correctly with his current move. The amateur is just guessing. The professional isn't guessing he knows the move to make and the direction to go. The AJT only hopes and guesses he is making the right move guessing the right direction of a security. The chess master takes his pieces away at will. This is wallstreet slowly taking away your pieces little by little one piece at a time. This is the AJT vs Wallstreet.
You are bringing a knife to a gun fight. And the guns they have are howitzers and m1 tanks, fleets of jet air craft, nukes/
You little peons just don't get it all? Do you? How badly out matched you really are?
All you can hope to do is scratch and claw by guessing and gambling.
it also helps,if one dept @ GS can release an upgrade for certain stock(move up guaranteed) and another dept,who knows about this news before general public, can trade it. it's also helps,if one firm can create an exchange,that operates outside of "regular exchanges",outside all rules and regulations and do whatever they want on it. who needs the f* bloomberg, if one can create the news,move the market and trade it on his own exchange?
they don't have to search for fucking edge..they can create one
It's never the outsider with a "better system" that succeeds but the insider who most thoroughly masters the internal system.
English is obviously not my native language,but i have to disagree with you on this one. a)-it's not a job, if you are retail.b)-i believe the word challenging would be more appropriate. the "dumb job" would be to press buy button,then after 2 seconds-press sell button. no decision making\thinking\using your own brain involved.
that would be a dumb job,if you ask me. flipping burgers all day long for fixed amount of money would also fit
are you kidding? You believe what you see on youtube?Comon....get real